Second quarter revenue was $120.6 million, up from $102.1 million in the second quarter of 2004. Exchange and clearing fee revenue in the second quarter grew 28 percent to $92.2 million, compared with $72.2 million in the second quarter of 2004. Second quarter operating income was $33.7 million, rising 18 percent from $28.5 million in the same period during the prior year. Operating income and net income in the second quarter include legal expenses of $4.0 million, which represents the final payment made to plaintiffs’ lawyers in an agreement made to settle the lawsuit brought by certain members of the CBOT relating to the proposed allocation of equity in the restructuring of the CBOT.
CBOT Holdings President and CEO Bernard W. Dan said, “Every major CBOT product category -- agricultural, financial, equity index and metals -- contributed to the CBOT’s volume growth this past quarter. Second quarter earnings also benefited from an increase in the average rate per contract, which rose 10 percent above last year’s level. Our success is largely attributable to a consistent and disciplined strategic focus on meeting global market users’ need for effective risk management – via the introduction of innovative new products, such as the May 2005 launch of the South American Soybean futures, increased access to the CBOT, and deep, liquid markets.”
CBOT trading volume in the second quarter of 2005 reached a new high. Quarterly volume rose 17 percent over the prior year to 184.9 million contracts. Average daily volume in the second quarter of 2005 increased to 2.9 million contracts, up 15 percent from 2.5 million contracts in the second quarter of 2004.
Key Financial Metrics (in millions, except rate per contract)
Quarter Ended June 30 June 30 March 31
2005 2004 2005
Revenue $120.6 $102.1 $116.5
Reported Trading Volume 184.9 158.5 173.1
Average Daily Volume 2.9 2.5 2.8
Average Rate per Contract $0.499 $0.455 $0.507
Operating Margin 28% 28% 31%
Net Income $ 18.2 $ 16.5 $ 20.8
1 The average rate per contract represents total exchange and clearing fee revenue divided by total reported trading volume.
CBOT Second Quarter Operational Highlights
- CBOT announced plans to establish a new telecom hub in Singapore, providing customers throughout Asia with direct access to the CBOT.
- CBOT successfully launched its South American Soybean futures contract on May 20, 2005, to address the risk management needs of producers and consumers of South American soybeans.
- CBOT signed a memorandum of understanding with Mercado a Término de Buenos Aires (MATba) to explore opportunities to extend the global reach of both exchanges.
- CBOT signed a memorandum of understanding with the Shanghai Futures Exchange to pursue cooperative programs and potential joint business ventures.
AVERAGE RATE PER CONTRACT
|
|
2Q |
1Q |
4Q |
3Q |
2Q |
1Q |
|
PRODUCT: |
2005 |
2005 |
2004 |
2004 |
2004 |
2004 |
|
Interest Rate |
$0.467 |
$0.482 |
$0.386 |
$0.417 |
$0.408 |
$0.484 |
|
Agriculture |
0.643 |
0.641 |
0.640 |
0.637 |
0.673 |
0.678 |
|
Equity Index |
0.630 |
0.578 |
0.560 |
0.564 |
0.550 |
0.525 |
|
Metals, Energy, & Other |
1.312 |
0.855 |
0.654 |
0.848 |
0.870 |
0.851 |
|
Overall average rate per contract |
$0.499 |
$0.507 |
$0.424 |
$0.451 |
$0.455 |
$0.519 |
|
VENUE: |
|
|
|
|
|
|
|
Open Auction |
$0.483 |
$0.491 |
$0.441 |
$0.490 |
$0.506 |
$0.525 |
|
Electronic |
0.397 |
0.400 |
0.315 |
0.330 |
0.319 |
0.429 |
|
Off-Exchange |
2.404 |
2.131 |
1.786 |
1.880 |
1.668 |
1.597 |
|
Overall average rate per contract |
$0.499 |
$0.507 |
$0.424 |
$0.451 |
$0.455 |
$0.519 |
AVERAGE DAILY VOLUME (in thousands)
|
|
2Q |
1Q |
4Q |
3Q |
2Q |
1Q |
|
PRODUCT: |
2005 |
2005 |
2004 |
2004 |
2004 |
2004 |
|
Interest Rate |
2,368 |
2,356 |
2,006 |
1,974 |
2,028 |
1,735 |
|
Agriculture |
404 |
373 |
287 |
295 |
391 |
375 |
|
Equity Index |
115 |
105 |
99 |
96 |
94 |
90 |
|
Metals, Energy & Other |
3 |
4 |
5 |
2 |
2 |
2 |
|
Total |
2,889 |
2,838 |
2,398 |
2,367 |
2,516 |
2,203 |
|
VENUE: |
|
|
|
|
|
|
|
Open Auction |
940 |
940 |
780 |
843 |
1,007 |
913 |
|
Electronic |
1,843 |
1,772 |
1,507 |
1,426 |
1,395 |
1,194 |
|
Off-Exchange |
106 |
126 |
110 |
97 |
115 |
96 |
|
Total |
2,889 |
2,838 |
2,398 |
2,367 |
2,516 |
2,203 |
|
|
2Q |
1Q |
4Q |
3Q |
2Q |
1Q |
|
|
2005 |
2005 |
2004 |
2004 |
2004 |
2004 |
|
Trading Days |
64 |
61 |
64 |
64 |
63 |
62 |
TRANSACTION FEES (in thousands)
|
|
2Q |
1Q |
4Q |
3Q |
2Q |
1Q |
|
PRODUCT: |
2005 |
2005 |
2004 |
2004 |
2004 |
2004 |
|
Interest Rate |
$70,733 |
$69,327 |
$49,535 |
$52,655 |
$52,201 |
$52,091 |
|
Agriculture |
16,604 |
14,598 |
11,752 |
12,044 |
16,556 |
15,775 |
|
Equity Index |
4,627 |
3,687 |
3,561 |
3,457 |
3,271 |
2,944 |
|
Metals, Energy & Other |
252 |
184 |
202 |
127 |
135 |
130 |
|
Total |
$92,216 |
$87,796 |
$65,050 |
$68,284 |
$72,163 |
$70,940 |
|
VENUE: |
|
|
|
|
|
|
|
Open Auction |
$29,085 |
$28,185 |
$22,039 |
$26,437 |
$32,061 |
$29,731 |
|
Electronic |
46,883 |
43,285 |
30,413 |
30,123 |
28,016 |
31,736 |
|
Off-Exchange |
16,247 |
16,325 |
12,598 |
11,723 |
12,086 |
9,473 |
|
Total |
$92,216 |
$87,796 |
$65,050 |
$68,284 |
$72,163 |
$70,940 |
About CBOT Holdings, Inc.
CBOT Holdings is the holding company for the CBOT, one of the world’s leading and most liquid derivatives exchanges based on contract volume, with 15 percent of the global listed futures and options on futures contracts traded during 2004. By providing a diverse mix of financial, equity and commodity futures and options on futures products for more than 157 years, the CBOT advances into the future on the strength of deep liquidity, market integrity, and member-trader expertise. Using superior trading technology in both electronic and open-auction trading platforms, the CBOT believes that it provides premier customer service to risk managers and investors worldwide. The CBOT’s market participants trade a variety of products, including futures and options on futures contracts on agricultural commodities, U.S. Treasury bonds and notes, 30-Day Federal Funds, interest rate swaps, DJIASM, ethanol and precious metals. Nearly 600 million contracts were traded on the CBOT’s markets in 2004, and the CBOT continues to achieve volume and open interest growth in 2005 as market participants leverage the CBOT’s unwavering commitment to strength, innovation and transparency.
On April 22, 2005, the CBOT completed a series of restructuring transactions, which, among other things, resulted in the CBOT being changed from a not-for-profit, non-stock corporation into a for profit, stock holding company, CBOT Holdings, Inc., and a for-profit exchange subsidiary, the CBOT.
For more information about the CBOT Holdings, the CBOT and its markets and products, please log on to our website at www.cbot.com.
Forward Looking Statements
In this release, our use of the words “may,” “will,” “should,” “could,” “expects,” “plans,”
“anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or other comparable terminology is intended to identify forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied in any forward-looking statements. More detailed information about factors that may affect our performance may be found in filings made by CBOT Holdings, Inc. with the Securities and Exchange Commission, which can be obtained at its website at www.sec.gov. Except for any obligation to disclose material information under Federal securities laws, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.
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